OpenAI and Anthropic Slash Prices 25% as Chinese AI Rivals DeepSeek and Moonshot Gain Ground

OpenAI and Anthropic in price war as Chinese AI rivals gain ground

Leading US AI labs such as OpenAI and Anthropic are releasing cheaper models as they fight to retain cost-conscious customers who are switching to cut-price alternatives from Chinese rivals. The price war comes as rising AI bills push companies to curb usage and seek cheaper models, helping Chinese developers including Moonshot and DeepSeek make inroads with users from Silicon Valley to Europe. OpenAI recently said that it was slashing prices for GPT-5.6 Luna, its "fastest and most affordable model", by 80 percent. Anthropic has launched Claude Opus 5, touting the system's "frontier intelligence... at half the price" of Fable 5, the company's most capable model. The moves have helped decrease prices that customers are paying for models from leading US labs by almost a quarter since mid-July, according to Silicon Data's token price index. Tokens are the units of data processed by language models and are used to calculate many customers' bills. The cuts mark a shift for US AI groups that make proprietary "closed" models that have, until now, competed heavily on performance. Increasingly capable "open" Chinese models -- which can be freely downloaded and tweaked by developers -- have contributed to pressure on prices. The moves also come as OpenAI and Anthropic plot initial public offerings at trillion-dollar valuations while investors seek evidence that the industry's vast spending on AI can generate returns. Corporate AI users face cost pressures as Anthropic and OpenAI shift some enterprise customers away from flat subscriptions and toward usage-based billing, under which companies pay according to the computational resources they consume. Some businesses have responded to a rise in bills by imposing caps on AI usage or testing cheaper alternatives. Companies such as DoorDash and Airbnb have said they have started to use Chinese-made models in an effort to rein in bills. That shift has coincided with a flurry of releases from Chinese labs that have narrowed the performance gap with leading US models, raising concerns in the US tech industry that American developers could lose customers even as they spend heavily to maintain their technological edge. AI labs offer a range of models with different capabilities and prices, with costs varying further according to the version of a model and the "effort" settings used. Customers are typically charged for input tokens, used to measure data fed into a model, and output tokens, which measure what it generates in response. The latest price cuts from US labs apply to mid-tier products and make them more competitive with Chinese offerings. OpenAI, for example, cut the price of GPT-5.6 Luna from $1 to $0.20 per million input tokens and from $6 to $1.20 per million output tokens. Anthropic launched Opus 5 at $5 per million input tokens and $25 per million output tokens -- half the price of its Fable 5 model. This week, the company called off a planned rise in prices for its Sonnet 5 model, which had been due to take effect from September. Headline token prices do not provide a straightforward comparison between AI models, however. More capable models can sometimes complete a task using fewer tokens or with fewer attempts, meaning a model that appears more expensive based on the headline price of tokens can ultimately cost less. Additionally, most can operate at different "effort" settings, which vary the computing power used to answer a question and can affect both performance and the ultimate cost of completing a task. Artificial Analysis, which benchmarks models across areas including math, science, coding, and reasoning, found Anthropic's Opus 5 at "medium" effort delivered similar performance and cost per task to Moonshot's Kimi K3 at "max" effort. OpenAI's GPT-5.6 Luna at "max" effort performed similarly to DeepSeek's V4 Flash at "max," but cost just under twice as much per task. Anthropic and OpenAI declined to comment. A person close to Anthropic said Opus 5's pricing below its flagship Fable 5 was how the startup's "family of models is built, so there's no connection to competitors." Mantas Lukauskas, AI tech lead at Hostinger, a website hosting provider that has used large language models since 2020, noted that prices for the very best models were "flat to rising." He added that the recent pricing changes are the "first real test" of whether groups such as Anthropic and OpenAI can protect the cost of their most advanced offerings: "The US labs have cut the middle and are defending the top."

OpenAI and Anthropic in price war as Chinese AI rivals gain ground

Leading US AI labs such as OpenAI and Anthropic are releasing cheaper models as they fight to retain cost-conscious customers who are switching to cut-price alternatives from Chinese rivals. The price war comes as rising AI bills push companies to curb usage and seek cheaper models, helping Chinese developers including Moonshot and DeepSeek make inroads with users from Silicon Valley to Europe. OpenAI recently said that it was slashing prices for GPT-5.6 Luna, its "fastest and most affordable model", by 80 per cent. Anthropic has launched Claude Opus 5, touting the system's "frontier intelligence . . . at half the price" of Fable 5, the company's most capable model. The moves have helped decrease prices that customers are paying for models from leading US labs by almost a quarter since mid-July, according to Silicon Data's token price index. Tokens are the units of data processed by language models and are used to calculate many customers' bills. The cuts mark a shift for US AI groups that make proprietary "closed" models which have, until now, competed heavily on performance. Increasingly capable "open" Chinese models -- which can be freely downloaded and tweaked by developers -- have contributed to pressure on prices. The moves also come as OpenAI and Anthropic plot initial public offerings at trillion-dollar valuations while investors seek evidence that the industry's vast spending on AI can generate returns. Corporate AI users face cost pressures as Anthropic and OpenAI shift some enterprise customers away from flat subscriptions and towards usage-based billing, under which companies pay according to the computational resources they consume. Some businesses have responded to a rise in bills by imposing caps on AI usage or testing cheaper alternatives. Companies such as DoorDash and Airbnb have said they have started to use Chinese-made models in an effort to rein in bills. That shift has coincided with a flurry of releases from Chinese labs that have narrowed the performance gap with leading US models, raising concerns in the US tech industry that American developers could lose customers even as they spend heavily to maintain their technological edge. AI labs offer a range of models with different capabilities and prices, with costs varying further according to the version of a model and the "effort" settings used. Customers are typically charged for input tokens, used to measure data fed into a model, and output tokens, which measure what it generates in response. The latest price cuts from US labs apply to mid-tier products and make them more competitive with Chinese offerings. OpenAI, for example, cut the price of GPT-5.6 Luna from $1 to $0.20 per mn input tokens and from $6 to $1.20 per mn output tokens. Anthropic launched Opus 5 at $5 per mn input tokens and $25 per mn output tokens -- half the price of its Fable 5 model. This week, the company called off a planned rise in prices for its Sonnet 5 model, which had been due to take effect from September. Headline token prices do not provide a straightforward comparison between AI models, however. More capable models can sometimes complete a task using fewer tokens or with fewer attempts, meaning a model that appears more expensive based on the headline price of tokens can ultimately cost less. Additionally, most can operate at different "effort" settings, which vary the computing power used to answer a question and can affect both performance and the ultimate cost of completing a task. Artificial Analysis, which benchmarks models across areas including maths, science, coding and reasoning, found Anthropic's Opus 5 at "medium" effort delivered similar performance and cost per task to Moonshot's Kimi K3 at "max" effort. OpenAI's GPT-5.6 Luna at "max" effort performed similarly to DeepSeek's V4 Flash at "max", but cost just under twice as much per task. Anthropic and OpenAI declined to comment. A person close to Anthropic said Opus 5's pricing below its flagship Fable 5 was how the start-up's "family of models is built, so there's no connection to competitors". Mantas Lukauskas, AI tech lead at Hostinger, a website hosting provider that has used large language models since 2020, noted that prices for the very best models were "flat to rising". He added that the recent pricing changes are the "first real test" of whether groups such as Anthropic and OpenAI can protect the cost of their most advanced offerings: "The US labs have cut the middle and are defending the top."

US AI Labs Cut Prices 25% in 1 Month to Fend Off Chinese Rivals | PYMNTS.com

OpenAI cut the price of its mid-tier model, GPT-5.6 Luna, by 80%, while Anthropic launched its Claude Opus 5 at half the price of its Fable 5, according to the report. These price cuts came at a time when companies are becoming more cost-conscious after seeing their AI bills rise, and when Chinese developers such as Moonshot and DeepSeek are gaining ground among U.S. and European customers by offering models that are cheaper and increasingly closer to the capabilities of leading U.S. models, the report said. The report said that while OpenAI and Anthropic have lowered the prices of their mid-tier models, they're maintaining or increasing the prices of their top-tier models. It added that a more capable, more expensive model may be able to complete a task with fewer tokens and therefore at a lower cost. PYMNTS has reported over the last two months that the AI price war is real and has reached American consumers, that soaring AI costs have pushed enterprise buyers to cheaper Chinese models and that the era of "tokenmaxxing," or pushing employees toward the biggest AI models and the heaviest usage, is ending after two years of unchecked growth. When OpenAI announced July 30 that it was cutting prices on select models, the company said in a blog post that it made the changes to improve the models' performance per dollar across enterprise workloads. On that day, OpenAI cut the price of GPT-5.6 Luna by 80%, cut the price of GPT-5.6 Terra by 20% and provided faster performance of GPT-5.6 Sol in the API while leaving its price unchanged. GPT-5.6 Sol is the company's frontier model. "We are building a resilient infrastructure portfolio and matching each workload to the systems best suited to run it," OpenAI said in the post. "That approach supports both ends of the price-performance curve." It was reported Thursday (Aug. 13) that DeepSeek is adding peak-hour pricing for its flagship V4 models that will quadruple the current levels, though the new prices remain lower than those of its main competitors.